Corporate Tax in the UAE is a federal tax levied on the net income or profits of businesses operating within the country. It is designed to align the UAE with global tax standards, enhance revenue generation, and support economic diversification beyond oil and gas revenues.
The Corporate Tax regime came into effect in UAE on June 1, 2023, and applies ...
Free Zones are an integral part of the UAE economy and play a critical role in driving economic growth and transformation both in the UAE and internationally. Free Zones offer businesses various benefits such as relaxed foreign ownership restrictions, streamlined administrative procedures, modern and sophisticated infrastructure, developed business communities and the availability of additional legal entity formsand commercial activities.
Any income earned by a Qualifying Free Zone Person that is eligible for a 0% corporate tax rate is considered Qualifying Income. This Qualifying Income is determined by business activities or transactions conducted within the Qualifying Free Zone.
Free Zone businesses can benefit from a 0% corporate tax rate. However, to qualify as a Qualifying Free Zone Person (QFZP), certain ...
Under the UAE Corporate Tax Law, the Qualifying Income (QI) of a Qualifying Free Zone Person (QFZP) is exempt from taxation. Income derived from Qualifying Activities that qualify as QI is not subject to tax liability. Conversely, income from other activities, including Excluded Activities, constitutes Non-Qualifying Income, which is subject to a 9% tax liability as per Article 3 of the Corporate Tax Law.
In the UAE, VAT (Value Added Tax) and Corporate Tax (CT) deregistration are crucial aspects of a business’s compliance with local tax regulations. Proper deregistration is essential for businesses that no longer meet the criteria for VAT or CT obligations, ensuring that they avoid unnecessary tax burdens and penalties. Here's why VAT and Corporate Tax deregistration are important:
1. Avoiding Penalties for Non-Compliance
In the UAE, businesses are ...